Question 1

Employees who save for retirement through an employer-sponsored qualified plan never include the earnings on their savings in gross income.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements regarding fringe benefits is false?

Accepted Answer

A)  The general rule is that an employee fringe benefit is taxable unless the benefit is specifically excluded from the employee's gross income. 
B)  Employers are not allowed to deduct the cost of nontaxable employee fringe benefits. 
C)  Nontaxable fringe benefits must be provided to employees on a nondiscriminatory basis. 
D)  None of the above is false. 
A)  The general rule is that an employee fringe benefit is taxable unless the benefit is specifically excluded from the employee's gross income. 
B)  Employers are not allowed to deduct the cost of nontaxable employee fringe benefits. 
C)  Nontaxable fringe benefits must be provided to employees on a nondiscriminatory basis. 
D)  None of the above is false.

Question 3

Mrs. Connelly, a self-employed individual, maintains a defined-contribution Keogh plan. Regardless of the amount of her self-employment income, Mrs. Connelly may contribute $51,000 to the Keogh plan in 2015.

Accepted Answer

A) True 
 B)False

Question 4

Jason Inc. maintains a qualified profit-sharing plan for its employees. This year, Jason contributed $2,300 to Ms. Preston's profit-sharing account. Which of the following statements is true?

Accepted Answer

A)  Jason can deduct the contribution, and Ms. Preston must include the contribution in her gross income. 
B)  Jason can't deduct the contribution, but Ms. Preston must include the contribution in her gross income. 
C)  Jason can deduct the contribution, but Ms. Preston does not include the contribution in her gross income. 
D)  Jason can't deduct the contribution, and Ms. Preston does not include the contribution in her gross income. 
A)  Jason can deduct the contribution, and Ms. Preston must include the contribution in her gross income. 
B)  Jason can't deduct the contribution, but Ms. Preston must include the contribution in her gross income. 
C)  Jason can deduct the contribution, but Ms. Preston does not include the contribution in her gross income. 
D)  Jason can't deduct the contribution, and Ms. Preston does not include the contribution in her gross income.

Question 5

In 2008, Mr. Delgado exercised an option to purchase 1,000 shares of his employer's stock for $29 per share when the market price was $65 per share. This year, Mr. Delgado sold the stock for $80 per share. Which of the following statements is false?

Accepted Answer

A)  If the option was an ISO, Mr. Delgado recognized a $51,000 gain on sale. 
B)  If the option was nonqualified, Mr. Delgado recognized a $15,000 gain on sale. 
C)  If the option was an ISO, Mr. Delgado has a $36,000 AMT preference item this year. 
D)  None of the above is false. 
A)  If the option was an ISO, Mr. Delgado recognized a $51,000 gain on sale. 
B)  If the option was nonqualified, Mr. Delgado recognized a $15,000 gain on sale. 
C)  If the option was an ISO, Mr. Delgado has a $36,000 AMT preference item this year. 
D)  None of the above is false.

Question 6

Mr. Smith, age 61, withdrew $12,000 from his traditional IRA this year. The balance in the account at year-end was $183,700, which included $40,000 of nondeductible contributions. Compute the taxable portion of the $12,000 withdrawal.

Accepted Answer

A)  $0 
B)  $2,453 
C)  $12,000 
D)  None of the above. 
A)  $0 
B)  $2,453 
C)  $12,000 
D)  None of the above.

Question 7

Traditional IRAs but not Roth IRAs are subject to a minimum distribution requirement when the owner reaches age 70½.

Accepted Answer

A) True 
 B)False

Employees who save for retirement through an employer-sponsored qualified plan never include the earnings on their savings in gross income.

Which of the following statements regarding fringe benefits is false?

Mrs. Connelly, a self-employed individual, maintains a defined-contribution Keogh plan. Regardless of the amount of her self-employment income, Mrs. Connelly may contribute $51,000 to the Keogh plan in 2015.

Jason Inc. maintains a qualified profit-sharing plan for its employees. This year, Jason contributed $2,300 to Ms. Preston's profit-sharing account. Which of the following statements is true?

In 2008, Mr. Delgado exercised an option to purchase 1,000 shares of his employer's stock for $29 per share when the market price was $65 per share. This year, Mr. Delgado sold the stock for $80 per share. Which of the following statements is false?

Mr. Smith, age 61, withdrew $12,000 from his traditional IRA this year. The balance in the account at year-end was $183,700, which included $40,000 of nondeductible contributions. Compute the taxable portion of the $12,000 withdrawal.

Traditional IRAs but not Roth IRAs are subject to a minimum distribution requirement when the owner reaches age 70½.

Taxes and Taxing Jurisdictions

Policy Standards for a Good Tax

Taxes As Transaction Costs

Maxims of Income Tax Planning

Tax Research

Taxable Income From Business Operations

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Nontaxable Exchanges

Sole Proprietorships, Partnerships, Llcs, and S Corporations

The Corporate Taxpayer

The Choice of Business Entity

Jurisdictional Issues in Business Taxation

The Individual Tax Formula

Investment and Personal Financial Planning

Tax Consequences of Personal Activities

The Tax Compliance Process

Filters

Exam 15: Compensation and Retirement Planning

Employees who save for retirement through an employer-sponsored qualified plan never include the earnings on their savings in gross income.

Which of the following statements regarding fringe benefits is false?

Mrs. Connelly, a self-employed individual, maintains a defined-contribution Keogh plan. Regardless of the amount of her self-employment income, Mrs. Connelly may contribute $51,000 to the Keogh plan in 2015.

Jason Inc. maintains a qualified profit-sharing plan for its employees. This year, Jason contributed $2,300 to Ms. Preston's profit-sharing account. Which of the following statements is true?

In 2008, Mr. Delgado exercised an option to purchase 1,000 shares of his employer's stock for $29 per share when the market price was $65 per share. This year, Mr. Delgado sold the stock for $80 per share. Which of the following statements is false?

Mr. Smith, age 61, withdrew $12,000 from his traditional IRA this year. The balance in the account at year-end was $183,700, which included $40,000 of nondeductible contributions. Compute the taxable portion of the $12,000 withdrawal.

Traditional IRAs but not Roth IRAs are subject to a minimum distribution requirement when the owner reaches age 70½.

Taxes and Taxing Jurisdictions

Policy Standards for a Good Tax

Taxes As Transaction Costs

Maxims of Income Tax Planning

Tax Research

Taxable Income From Business Operations

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Nontaxable Exchanges

Sole Proprietorships, Partnerships, Llcs, and S Corporations

The Corporate Taxpayer

The Choice of Business Entity

Jurisdictional Issues in Business Taxation

The Individual Tax Formula

Investment and Personal Financial Planning

Tax Consequences of Personal Activities

The Tax Compliance Process

Filters